The International Monetary Fund (IMF) collects and publishes quarterly data on the currency composition of official foreign exchange reserves, known as COFER. The data are published for three groups: the world, the advanced economies, and the emerging and developing economies. For each group, allocated reserves are broken down into the traditional reserve currencies (US dollar, [...]

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This note provides a quick guide—in the form of a table—to the likely candidates to succeed Dominique Strauss-Kahn as next Managing Director (MD) of the IMF, assuming that he resigns shortly. It also highlights some key points that must guide the process of selecting the next MD. Need for urgent action. The IMF is at [...]

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The rise of emerging economies has long been recognized as a defining feature of our times when it comes to trade, manufacturing, and an increasing range of services businesses. Until recently, however, there was  widespread sentiment that international finance was somehow escaping the trend. A dominant share of financial assets, financial companies, financial centers, and [...]

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On August 15, India celebrated 63 years of independence. Many hail it as an economic powerhouse but also point to the lopsidedness of its growth. Despite being home to some of the world’s leading technology companies, poverty is still widespread, physical and social infrastructure still woefully inadequate, employment opportunities still limited, and access to basic [...]

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On February 19, 2010, the International Monetary Fund released a “Staff Position Note” on capital controls as a policy instrument.1 The paper concluded that, subject to four conditions, controls on capital inflows can be justified. The four conditions are: the economy is operating near potential, there is an adequate level of reserves, the exchange rate [...]

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Paul Krugman, in a column last month for the New York Times, endorsed a tax on financial transactions, proposed recently by Adair Turner, Britain’s top financial regulator. It is important to distinguish this Turner proposal from the original Tobin tax on international flows and these two taxes in turn from the kind of coordinated capital [...]

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The G-20 finance ministers and Central Bank governors met over the weekend in St. Andrews, talking about the data they will need to look at in order to monitor each other’s economic performance and sustain growth (seriously). The underlying idea is that if you talk long enough about the US current account deficit and the [...]

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There are two ways to think about inflation in today’s economy. The first, suggested by conventional macroeconomic frameworks for the United States, is that, with rising unemployment and actual output sinking further below “potential” output, inflation will stay low—and we could actually experience the dangers of falling wages and prices (think what happens to mortgage [...]

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Does the United States’ need to borrow undercut the needs of others? That was the argument of a front page article in the New York Times on March 9, reporting that the global flight to dollar-denominated US government securities had contributed to a sharp reduction in the external financing for developing countries. The article strongly [...]

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The financial crisis has now caught up with emerging markets—with a vengeance. Wherever you look, in Eastern Europe and the Baltics, Latin America or Asia, the financial carnage is evident. Even China, the most immune to contagion, is going to see its growth decline from 12 percent to 9 percent. Elsewhere, panic in global financial markets has compelled the International Monetary Fund (IMF), which previously was trying to adapt to a no-crisis world, back in the lending and financial rescue business. While the IMF engages in talks with Hungary, Iceland, Ukraine, Pakistan, and other countries, the United States and its European partners have begun discussions about stepping in with credit lifelines to middle income developing countries in desperate need of dollar loans to avoid default.

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